The Institutional Limited Partners Association (ILPA) released considerations for both limited partners (LPs) and general partners (GPs) in respect of continuation fund transactions, including GP-led secondaries, in May 2023. Continuation funds have become more common in the private equity industry, and ILPA’s guidance attempts to establish a shared set of LP and GP expectations for such transactions. The guidance outlines principles on how, when, and to what capacity LPs should be engaged in the process as well as recommendations on disclosures, structure, timing, economics, and other legal considerations.

In general, ILPA recommends two overarching principles: (i) continuation fund transactions should maximize value for existing LPs and (ii) rolling LPs should be no worse off than if a transaction had not occurred.